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Politicians are underpaid. Did I seriously just type that?

The case for – gulp – increasing the salaries for our top political positions

Jun 9, 2014

By Todd Humber

There’s a good argument to be made that politicians are underpaid. A good argument, maybe, but it’s a tough sentence to type and a tough thought for readers to digest.

It’s also an observation that won’t find a lot of nodding heads in a Tea Party-fuelled era of less government is better government. Or talk of ending gravy trains and respecting taxpayers.

But look at the responsibilities of a mayor, a premier and the prime minister. Look at the portfolios many ministers carry, and the massive impact their decisions can have on the economy and the nation as a whole.

In the June 16 issue of Canadian HR Reporter, one of the items in the HR by the Numbers infographic on page 4 outlines compensation packages for CEOs of publicly traded companies in the United States. The median pay package was $10.5 million.

The median.

CEO versus PM

The high end was $68.3 million, for Anthony Petrello of Nabors Industries. Admit it. You don’t know who Nabors Industries is or what they do. (They’re an oilfield services company.) But at that level, he makes 208 times more than Stephen Harper.

Political feelings aside, is the CEO of a corporation really worth that much more than the leader of the world’s second largest country and one of the largest economies on the planet? Petrello’s firm had revenue of about $6.1 billion in 2013. The Canadian government’s revenue in 2014 is expected to be $276.3 billion.

(And let’s set aside the argument, for now, that CEOs are grossly overpaid.)

Even a CEO earning the median income takes home 32 times what the PM does —the prime minister’s current pay in Canada is $327,400 annually.

The provincial view

The comp numbers are even bleaker on the provincial level. A quick, rough rundown of approximate salaries for premiers according to Maclean’s:

The compensation for a mayor is all over the place. According to the Toronto Star, the highest paid mayor in Canada is in Brampton, Ont. — she earned nearly $214,000 in 2012. In the same year, Calgary’s mayor pulled in $202,000 and Toronto’s mayor earned $173,000.

None of those wages are a pittance. To the average working Canadian, they look like princely sums. But in the mahogany-lined boardrooms, they’re a drop in the bucket. Here’s a challenge for recruiters out there. Try and headhunt Gord Nixon, CEO of Royal Bank, to be Canada’s next finance minister. Nixon made $12.7 million last year. A cabinet minister makes $242,000.

That’s going to be a tough sell.

Compensation 101

So what’s the point of all this number crunching and handwringing over politician salaries? It really comes down to human resources 101 — if you’re not willing to pay for the best talent, you’re not going to be able to get it.

Sure, being a politician comes with other perks — leading a city, a province or a country certainly plays to the ego side of things. Plus there’s also the fame angle, if that’s your cup of tea.

If we truly want the best, if we want inspirational leaders at the helm who are at the top of their games, then we might have to throw more money into the pot to convince the best leaders in Canada to go into political roles. But we all know that’s not going to happen. Raising the salaries of politicians is political suicide — whoever does it is going to get hammered at the ballot box, defeated by whoever promises to roll the wages back.

But the next time you’re at a polling station, feeling disillusioned and wanting to check “none of the above” at the lack of inspirational leadership — perhaps you shouldn’t blame the parties, but rather the paycheque.